“The accounts raise the question of how long the rest of the News Corp empire can carry the underperforming Australian newspapers business.” Photo: Jason Reed

“Combined with the sharp earnings drop already reported in 2013-14, and with circulation and advertising revenues continuing to decline, the accounts suggest News Corp’s Australian newspapers, including the national, metro and regional publications, will struggle to break even this financial year,” writes Crikey’s Paddy Manning.

“The accounts raise the question of how long the rest of the News Corp empire can carry the underperforming Australian newspapers business.”

Crikey says the Australian papers’ operating income fell 67% to $94 million in 2012-13, the year before they were spun off as part of News Corp from 21st Century Fox.

“Within the division, The Australian stands out as the worst performer: revenues dropped 20% from $135 million to $108 million in 2012-13, while operating income fell 41% from a loss of $19 million to a loss of $27 million. After depreciation, the masthead’s operating loss fell to $30 million.”

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For the 2013-14 year, News Corp reported that earnings before interest tax depreciation and amortisation (EBITDA) from Australian newspapers fell by $73 million — ”which by Crikey’s estimate represents roughly an 80% fall on the previous year, nearly wiping out the division’s entire operating income”.

While the Australian newspapers are dragging down News Corp, the Australian newspaper appears to be dragging down the rest, losing $30 million in 2012-13 and more this year.

At the same time, the average worker on the Oz is paid substantially more - $178,000 a year - than those on the more profitable metropolitan dailies.

But there have certainly been some who have done well out of News Corp – notably ABC television news finance correspondent and web site vendor, Alan Kohler.

Kohler and his partners, including Crikey publisher Eric Beecher, sold the Business Spectator and Eureka Report sites to News for $30 million in 2012.

Crikey reports Business Spectator cost News $2.5 million in red ink in the next year while Eureka Report had just $671,000 in operating income.

At the end of June last year, Eureka Report had just 14,294 subscribers.

No Eureka moment in that deal then for Murdoch, but a happy bailout for Kohler.